Finance/Operations Management

1. The following information is known about a project.

a. Draw the network diagram for this project.

b. Determine the critical path and project duration.

c. Calculate the slack for each activity.

Activity	Activity (days)	Immediate Predecessor(s)
A	7	----
B	2	A
C	4	A
D	4	B, C
E	4	D
F	3	E
G	5	E

2. Performance criteria important in creating a layout can go well beyond communication and materials handling. Identify the types of layout performance criteria that might be most important in the following settings.

a) Airport

b) Bank

c) Classroom

d) Product designer’s office

e) Law Firm

4. Suppose you are in charge of a large mailing to the alumni of your college, inviting them to contribute to a scholarship fund. The letters and envelopes have been individually addressed (mailing labels were not used). The letters are to be processed (matched with correct envelope, time estimated to be 0.2 minutes each), folded (0.12 minutes each), and stuffed into the correct envelope (0.10 minutes each). The envelopes are to be sealed (0.05 minutes each), and a large commemorative stamp is to be placed in the upper right hand corner of each envelope (0.10 minutes each).

a) Make a process chart for this activity, assuming that it is a one person operation.

b) Estimate how long it will take to stuff, seal, and stamp 2,000 envelopes. Assume that the person doing this work is paid $8 per hour. How much will it cost to process 2,000 letters?

c) Consider each of the following process changes. Which changes would reduce the time and cost of the current process?

· Each letter has the same greeting “Dear Alumnus or Alumna,” instead of the person’s name.

· Mailing labels are used and have to be put on the envelopes (0.10 minutes each).

· Pre-stamped envelopes are used.

· Envelopes are stamped by postage meter which can stamp 200 letter per minute.

· Window envelopes are used.

· A pre-addressed envelope is included with each letter for contributions (adds 0.05 minutes to stuffing step)

d) Would any of these changes be likely to reduce the effectiveness of the mailing? If so, which ones? Why?

e) Would the changes that increase time and cost be likely to increase the effectiveness of the mailing? Why or why not?